IT contractor jobs downturn eased dramatically in June

The IT contracts market chalked up its biggest monthly rise in new opportunities in June 2020 since 1997, massively cutting how far covid is keeping freelance IT skills-demand in the red.

But warning against reading too much into the historical rise, the REC said that March to April was also the “quickest drop” in IT contracts since the index began, again due to coronavirus.

On the ground, the improvement to 29.9 from 17.8 (in May) means clients are continuing to either “pause or cancel” hiring while “bringing furloughed staff back to work”, the body said.

'Improvement for IT contractors should continue, if...'

The Recruitment and Employment Confederation’s update comes after jobs agency Premier Group said it was reopening some of its offices to help put IT contractors “back in the field.”

“As long as the pandemic continues to subside and infection rates don’t increase again, we should see this improvement continue,” an REC spokesman told ContractorUK, adding:

“The rise in the vacancy index for temporary IT staff is the largest monthly rise since the survey began in 1997…[but] there’s still a way to go before it returns to positive territory”.

'Remotely onboarding new starters'

As the lifespan of the pandemic in the UK is equally unknown, some agencies are offering free guides to help companies “remotely onboard new starters,” both perm and contract.

Another agency is apparently asking applicants about what they have been doing during lockdown and using it as a selection criteria to judge what sort of applicant they are.

While at least one ContractorUK reader would likely welcome the probe, the head-hunter who disclosed it, Robert Kenward, implied it was unfair and morally inappropriate.

'Furlough issues'

Online updates by others in recruitment show that some agents are still getting to grips with furlough returners, not helped by CJRS guidance always being clear or covering every eventuality.

Ann Swain, chair of APSCo posted to LinkedIn yesterday:

“A furlough issue, namely whether it is appropriate to pay notice of termination when on the Job Retention Scheme has been escalated by BEIS to HMRC and Treasury, following a slight rewording in the latest Treasury Direction.”

'Commercial risk'

Similarly, Neil Carberry, the REC’s chief executive reflected: “Agencies should remember that furlough is available where someone would normally have been paid.

“So there may be a commercial risk there with HMRC,” he advised. “We are asking the government for greater clarity.”

Although he was referring to difficulties with the furlough scheme in Teaching, the confederation believes that all job sectors need a pick-up from the chancellor this afternoon.

'We are now in a jobs crisis'

“This is now a jobs crisis,” Mr Carberry said. “Rishi Sunak should use today’s Summer Statement to boost job creation, with a cut in National Insurance designed to retain jobs and boost hiring.

“Action on skills will also be vital to getting people into growing sectors – including a more flexible approach to levy-funded training.”

James Stewart, vice-president of KPMG echoed: “The air of uncertainty around the COVID-19 pandemic will linger – and rebuilding confidence in the UK jobs market will take time.

“[So] all eyes will be on the chancellor’s fiscal statement today, with job-seekers hoping to see a focus on skills and retraining.

He added: “UK business will welcome further support packages so they can start to ramp up as lockdown eases, and recovery gets underway.”

'Skills in short supply'

But the REC’s list of “skills in short supply” is unusually short, indicating that demand in June did not significantly outstrip supply -- a hallmark of ‘business as usual’ in  the IT sector.

In fact, other than a shortage of general IT/Technology contractors, only three skills were hard to find for freelance contracts last month – Development, Data Science and C#.

Agents supplying the permanent market were on the same search for all five tech skills, but also reported shortages of Analysis, CNC and Digital, in trying to fill full-time vacancies.

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Written by Simon Moore

Simon writes impartial news and engaging features for the contractor industry, covering, IR35, the loan charge and general tax and legislation.
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